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7.3. Terminal Losses

In a situation concerning the cessation of trade where terminal losses arise, the losses can be carried back to accounting periods ending within three years preceeding the start of the accounting period in which the loss was incurred.  If the final twelve months straddles two accounting periods, the terminal loss arising in the earlier accounting period may be carred back to accounting periods ending more than three years prior to the start of the twelve month terminal loss period.  A claim for the relief must be made within two years of the end of the accounting period where the loss was incurred.  

This extension does not apply if the company ceases to trade on or after 21 May 2009, or if the activities of the trade continue to be carried on by persons not within the charge of corporation tax or if the cessation of trade is part of a scheme or arrangement with a main purpose of securing the enhanced carry-back.